Obamacare Is Coming… To Russia

With “keg-standing bros” and “easy women” having been tempted already (unsuccessfully from what we know) to participate in the government’s ‘affordable’ care act, Politico reports the Obama administration today unveiled its plans for an Olympic-size ad blitz during the winter games next month. No comments yet on which images will be used (it’s too soon for any Schumacher references) but we suggest ‘skeleton’ will provide the right ‘stimulation’ to get insured.

 

 

Via Politico,

HHS confirmed Tuesday that it has bought advertising time in markets with high rates of uninsured people to air during the Winter Olympics, which run Feb. 7-23.

 

To date, the administration has focused its outreach efforts in areas around Houston, Dallas, Tampa and Miami, dispatching senior officials like HHS Secretary Kathleen Sebelius to spread the word about new benefits under Obamacare.

 

The ads, which will run in markets like these across the country, will be aimed at young uninsured people and their families, an HHS official confirmed. POLITICO also confirmed that ads will run in North Carolina. According to HHS, ratings for typical primetime and sports programming dip during the Olympics, so the administration moved some of its paid media budget to the NBC Olympic inventory to maximize viewership.

 

No word on the images that might be used along with the usual messaging, although high-injury events such as the giant slalom or snowboarding offer immediate visuals to underscore the risk of going without health insurance.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/hyaNwybv_LQ/story01.htm Tyler Durden

The Disenchantment Of American Politics (And The Coming Uproar)

Submitted by James H Kunstler via Peak Prosperity,

Considering the problems we face as a nation, the torpor and lassitude of current politics in America seems like a kind of offense against history. What other people have allowed circumstances to run over them like so many ‘possums sleeping on the highway?

The financial disturbances of recent years especially have trashed millions of households, yet the fat middle (no pun intended) of the broad public (ditto) seems strangely content with all the tawdry sideshows of the day – Black Thursday, the Kardashians, the NFL playoffs, Twitter, texting, twerking, side boobs – taking little-to-no interest in politics while their prospects for a habitable future swirl around the drain. How might we account for such supernatural passivity?

And, since human affairs don’t remain static indefinitely, in what direction might things go when the political mood finally heaves and shifts? The possibilities are unsettling.

A Failure to Lead

If you care about poll numbers, they tell a simple story of contempt for the current crop of US political leaders. Congress rates a 12 percent approval rating and President Obama, at 35 percent, scores lower than Richard Nixon did in the midst of the Watergate fiasco. I’m surprised that Obama’s numbers aren’t lower (and I voted for him, twice). After all, few American lives were actually touched by the lies and shenanigans that spun off of Watergate, and money was an inconsequential part of it. But a whole lot of people were affected by Obama’s dissimulations around the Affordable Care Act, while his tragic failure to reestablish the rule of law in banking from the get-go in 2009 probably amounts to impeachable malfeasance. Add to this the NSA domestic spying operations revealed by Edward Snowden plus the troops indefinitely garrisoned in Asian countries and you have a portrait of a creeping Orwellian contagion.

The only whiff of rebellion in the air lately has emanated from the so-called conservative end of the political spectrum: the Tea Party. Its complaints mainly range around the offenses of Big Government, though a certain incoherence pervades its agenda as a whole. (I will get to that presently.)  I am sympathetic to gripes against the size and reach of government but I’m convinced that the swerve of US politics in the not-distant future will hinge on the failure of government at this scale to conduct any business competently. Anyway, as a veteran of the hippie uprising of the 1960s, when the Left was insurgent against an obdurate “establishment,” it’s interesting to observe the perverse flip-flop of history that has now put the Tea Party in charge of rebellion central.

The failures of the Left these days are pretty obvious and awful. They got their storybook change-agent elected president and he hasn’t done a darn thing in five years to halt the wholesale racketeering that pervades our national life. Obama’s Department of Justice is home to more zombies than the Grand Cemetery of Port-Au-Prince. The Attorney General’s office essentially signed off on prosecuting bank fraud when Lanny Breuer, chief of the Criminal Division, declared some banks too big to jail. End of story, as Tony Soprano used to say.

 

Obama promised to brick up the revolving door between Wall Street and the federal agencies and he only added more turnstiles to the gate. Most of the government officials involved in the 2009 TARP program and related crisis management operations are now pulling in six figure salaries at the banks and hedge funds they formerly regulated, while a veteran fixer (Mary Jo White) from the whitest white shoe fixit law shop in the land (Debevoise & Plimpton) was appointed to head the SEC a year ago.

The Left, as represented by President Obama and a majority in the US Senate, did nothing to arrest the ongoing corporate hijacking of the USA. When the Supreme Court ruled in the Citizens United case (2010) that corporations could buy elections via unlimited campaign contributions under the free speech clause of the constitution, Obama had the chance to propose new legislation or a constitutional amendment to redefine the distinction between human persons and corporate “persons.” You’d think that as a constitutional lawyer, he would have been eager to lead on this. But he just ignored the historic opportunity and, anyway, he was on the receiving end of gobs of corporate “free speech” money to run his reelection campaign.

Apart from its pitiful roll-out bugs, the Affordable Care Act has the odor of the biggest insurance scam in history. People joke these days about Obama serving George W. Bush’s fourth term. The internal contradictions of Democratic Party behavior under Obama have only driven political cynicism to new heights. The millennial generation must feel horribly swindled by it.

A Paucity of Good Options

As for the rebellious conservative Tea Party faction, it is hard for me to square their umbrage at Big Government with their avidity for foreign wars (and support for the military-industrial rackets behind them), their failure to oppose the security-state activities of the NSA (while branding whistleblower Snowden “a traitor”), their love of corporate commercial tyranny a la Wal-Mart, their devotion to economically suicidal suburban sprawl, their zeal to control the social and sexual conduct of their fellow citizens, and their efforts to impose religion in civic affairs — all of which is to ask, what do they mean when they shout about “liberty?”

These contradictions probably seem abstruse compared to the gritty plight of ordinary citizens getting monkey-hammered in an economy that can provide neither decent incomes nor dignified, meaningful social roles for classes of people who could be earnest, honest, and enterprising given the chance. This gets to a more general failure across the political spectrum to apprehend the larger changing dynamics of our time — resource scarcity, capital impairment, contraction, environmental collapse, population overshoot — and to frame a coherent response to these developments. In short, the politicians seem to have no idea where history is taking us, and no road-map to prepare for the journey to get there.

There will probably always be some alignment of Left and Right in politics, but from time to time the packages they come in and the ideologies they contain are in desperate need of either rehabilitation or dissolution. I’d bet that we may soon see the demise of both the Democratic and Republican parties as they are currently structured. They’ve been around an awful long time now, and their presence probably provides a certain reassuring familiarity, but that is also the same growth medium as contempt. The useless and tiresome public quarrels they spawn these days, the kabuki theater debt ceiling showdowns, the can-kickings, and other evasions of responsibility, erode basic institutional trust to a dangerous degree; the people lose faith in the courts, the news media, the banks, the value of their money, and eventually all authority. The two major parties function as mere conduits for all the racketeering operations that define life in this nation today. The mature two-party system may prove to have been a transient product of America’s industrial heyday, which is now over despite the euphoria over stock bubbles, shale oil, computers and other new technology. If the two old parties dry up and blow away, will anyone shed a tear for them? When that happens, there may not be enough political vitality left at the federal level to reconstitute them in new packaging.

Trouble Brewing

If party politics are weak, muddled, and contradictory, the divisions between Americans are starkly clear: wealth in America has never been so unevenly distributed — the fabled one percent versus everyone else. Despite the election of a mixed-race president, and the wish-fulfillment fantasies of Hollywood, race relations in the USA remain tense. 2013 was the year of the “knockout” game for black teenagers randomly targeting “woods” (i.e. non-black “peckerwoods”), some of whom died. It was the year of George Zimmerman’s acquittal in the Trayvon Martin case and the echoing recriminations.

Divisions between men and women are tragically compounded by the dangerous dynamics of work in America that leave many men (especially men) in a vacuum of purpose, meaning, and potency. It is almost impossible these days for low-skilled men to support a family. The indignity of this thunders through broken communities and the penitentiary cellblocks. But the anomie is also expressed in the higher ranks of an economy where office work can be done by anybody, and gender confusion lately has been valorized as a compensating mechanism for the marginalization of men and the failure of manhood. The political blowback from this, when it comes, is apt to be fierce. Look no further than Duck Dynasty.

The ongoing national culture war pits the “traditional values” faction against the sexual libertarians; the red states against the blue states; urban against the conflated suburban and rural; the Christian fundamentalists against an array of other positions and belief groups; the entitlement “socialists” against the “free market” conservatives.

Perhaps most divisive of all will be the schism between the young and the old over the table scraps of the dying industrial economy.

These tensions will not remain unresolved indefinitely.

In Part II: Get Ready For Strange Days, we'll forecast the direction that this resolution may follow. The last time the USA faced a comparable political convulsion was the decade leading into the Civil War, but this time it will be more complex and confusing and it will have a different ending. A dominant theme will be a continued loss of faith in the Federal government to solve our ills, and a re-emergence of reliance on local support networks at the state, municipal, community and family levels.

This devolution will likely play out very differently across the major regions of the US. And most will follow this course unwillingly.

Strange days are coming.

 


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/nwT7ky2eT5s/story01.htm Tyler Durden

Shrinking Bulls?

As the following chart shows, investors can worry no more of over-exuberance, uber-complacency, and super-confidence as the AAII bull-bear survey saw bulls drop to a mere 60.6% this week… panic over…

 

 

Not!

 

(h/t @Not_Jim_Cramer)


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/Kr5GW5r95RU/story01.htm Tyler Durden

Here Is The Next Wall Street Crack Down (And Yes, JPMorgan Is In The Middle Of This One Too)

Nearly a year ago, we predicted that the party for bond traders was over. The reason: MBS bond trader Jesse Litvak, formerly of mid-tier, perpetual aspirational bulge bracket, and the place where every fired UBS banker has a safety cubicle, Jefferies, got not only too greedy (that’s ok, everyone on Wall Street is), but what’s worse, got caught. Understanding why Litvak got caught requires an understanding of just how modern bond trading works, or rather worked, and why it was a dollar bonanza for years.

This is how we explained it:

For many years one of the best jobs on Wall Street in terms of a mix of job safety and compensation, was to be a fixed income trader-cum-salesman working for a major bank with a deep balance sheet, which could hold illiquid securities on its prop account, to dispose of as the “flow” (or clients) required, and on unsupervised and unregulated terms that were simply a verbal arrangement between the bank trader and the end client, usually a counterparty trader working for a major institutional buyside shop, including mutual or hedge funds.

 

Since for the most part, the buyside traders operated with other people’s money, they were largely indiscriminate on the fine pricing nuances of the acquisition (or disposition) of the securities at hand, and while to the “other people’s money” under management whether a given bond was bought for 55 or 55.75, or a given MBS was sold for 72-6 or 72-16 meant little (after all the trade was driven by a big picture view that the security would go up or down much more and certainly enough to cover the bid/ask spread, resulting in much larger profits upon unwind), the transaction price had a huge impact for the bank traders-cum-salesmen arranging said deals. Because when one is selling a $40 million MBS block, a 1 point price swing equals a difference of $400,000. Make 15 such deals per year, and one’s $1,000,000 bonus (assuming a ~15% cut on the profits) is in the bag.

 

It wasn’t necessarily an easy job – it required an extensive rolodex, a keen ear for who held what securities in one’s given space, constant schmoozing, and manning the phones constantly. More importantly, everyone knew how the game is played: everyone knew that the middlemen would usually skim a few basis points on the top or bottom of the bid-ask spread, in exchange for having the first call the next time a juicy security was being shopped around, or whenever one had to offload some debt in a hurry.

 

Keep in mind this type of trading of OTC (Over The Counter) instruments, which included and still includes most corporate bonds, Credit Default Swaps and all other derivatives, Mortgage Backed Securities, Bank Loans, Bankruptcy Claims, and other blocky piece of paper, was always vastly different from equity trading where every trade was electronically recorded, where the bid/ask spreads were negligible due to infinite competition for every trade, yet which ultimately led to the advent of such robotic predators as High Frequency Trading algorithms which do at the micro scale what the old equity specialist and current bond salesman/trader do at the macro level. In short: the highly lucrative and extremely profitable bid/ask skimming that every bond trader engaged in for years has been impossible in equities for the simple reason that the bid/ask spread on most equity-related securities is minute and the market is far deeper and (at least used to be) far more liquid.

 

It also explains why 4 years after the Great Financial Crisis, there is still no centralized, computerized trading portal for OTC trades, including corps, CDS, loans, etc. Doing so would mean that the banks would give up billions in additional commissions that they could charge if all such trades were facilitiated by the kind of sales coverage middlemen described above. Because while a salesman was incentivized to peel as much as they could of a given trade, they would at best pocket some 10-15% of the total spread. The rest went to the bank, and thus to management in the form a massive bonuses: comp at banks is not 40% of revenue for nothing, with some money left over for “retained earnings.”

 

But back to the credit traders which for years had built up their reputations in given product verticals, and which had a coverage of fiercely guarded clients, which no other salesmen at a given firm were allowed to converse with. Now was it well-known that salesguy X would pick an additional 50 bps on top of the price being quoted? Sure. After all, someone had to pay for those weekly trips to the Hustler Club, and that’s precisely what the Salesmen did. And who really cared about a little vig? Remember – it was all being down with “other people’s money.”

 

Well, the days of rampant skimming on top of the bid/ask spread, and with them record bonuses for bond traders and salesmen, may just ended with a whimper not a bang, and all bond traders hoping to make millions by misrepresenting what the true purchase or sale prices are to buysider clients, even if completely voluntary on both sides, may want to seek employment elsewhere.

 

They have Jesse Litvak to thank for it.

A senior SEC official at the time described the alleged conduct as “unfit for a used-car lot, let alone a marketplace for mortgage-backed securities.” Either way, little did we know how correct we would be, because not only did the former MBS trader, who as we said then “proceeded to rip virtually all of his clients on seemingly every single trade he executed for the three years he was employed at Jefferies, lying to everyone in the process: both clients and in house colleagues, generating some $2.7 million in additional revenue for Jefferies for the duration of his tenure, and who knows how much in personal bonuses”, end the party, but it appears he has managed to unleash the next big regulatory crack down on Wall Street. And one which may just cost perennial Department of Justice favorite JPMorgan another several billion in “litigation reserves.”

The WSJ reports that with the fraudulent mortgage bond crackdown largely in the history books, the next target for regulators will be to focus on precisely what Litvak was doing (full disclosure: Patrick J. Smith, a lawyer representing Mr. Litvak, said last year that his client “did not cheat anyone out of a dime.” Mr. Smith declined further comment Tuesday). On a mass scale. To wit:

“Prosecutors are working alongside regulators in a broad investigation into whether a number of Wall Street banks cheated mortgage-bond clients in the years following the financial crisis, according to people close to the probe.

 

The Justice Department is investigating alongside the Securities and Exchange Commission and the special inspector general for the Troubled Asset Relief Program, or Sigtarp, the people close to the probe said. The investigation, revealed by The Wall Street Journal in a page-one article Wednesday, is the first known wide-ranging probe into mortgage-bond sales by banks in the years after the economic meltdown of 2008.

 

The involvement of prosecutors wasn’t previously reported.

And guess who is involved: everyone’s favorite allegedly criminal bank that neither admits nor denies manipulating everything – JPMorgan.

J.P. Morgan Chase & Co. said in a securities filing last year it had received requests for information from the U.S. attorney’s office in Connecticut, as well as subpoenas from the SEC and a request from Sigtarp to review “certain activities.” The requests relate to “communications with counterparties in connection with certain mortgage-backed securities transactions,” according to the filing.

 

J.P. Morgan’s disclosure refers to the government probe reported by the Journal, according to a person familiar with the matter.

 

The New York firm is one of at least eight banks under scrutiny in the wide-ranging probe, the people close to the investigation said.

 

The investigation underscores how J.P. Morgan’s legal headaches are far from over, even as it shells out billions to resolve numerous probes. The largest U.S. bank has agreed to roughly $22 billion in payouts over the last year to end a slew of lawsuits and investigations into many aspects of its business, including the 2012 “London whale” trading debacle and alleged failures to stop Bernard L. Madoff’s massive fraud.

Make that $22 billion plus $1-2 billion more. Oh, and in case you didn’t realize it yet, this is why Jamie Dimon is richer than you.

 


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/AXPctYpkfoc/story01.htm Tyler Durden

NJ Governor Christie Statement: (Some) “People Will Be Held Reponsible”

New Jersey Governor Chris Christie is rapidly trying to distance himself from the 'deputy chief of staff plotting to create traffic problems' bridge controversy… his full statement (below) can be summed up: …

"This behavior is not representative of me or my Administration in any way, and people will be held responsible for their actions."

People will indeed be held responsible, with one very prominent exception.

The controversy:

The communications suggest that Christie’s deputy chief of staff and two of his top appointees at the Port Authority of New York and New Jersey closed a pair of access lanes from Fort Lee, N.J., onto the George Washington Bridge into New York, causing days of gridlock and mayhem in the Fort Lee area last September.

 

 

“He is the worst example of bully and boss,” Buono said. “And this string of e-mails clearly exposes a web of deceit, subterfuge and arrogance leading straight to Chris Christie.”

The "throw everyone under the bus" Full statement

"What I've seen today for the first time is unacceptable. I am outraged and deeply saddened to learn that not only was I misled by a member of my staff, but this completely inappropriate and unsanctioned conduct was made without my knowledge. One thing is clear: this type of behavior is unacceptable, and I will not tolerate it because the people of New Jersey deserve better. This behavior is not representative of me or my Administration in any way, and people will be held responsible for their actions."

Of course, there is one very large exception to that statement…


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/Jp3snPu06gc/story01.htm Tyler Durden

NJ Governor Christie Statement: (Some) "People Will Be Held Reponsible"

New Jersey Governor Chris Christie is rapidly trying to distance himself from the 'deputy chief of staff plotting to create traffic problems' bridge controversy… his full statement (below) can be summed up: …

"This behavior is not representative of me or my Administration in any way, and people will be held responsible for their actions."

People will indeed be held responsible, with one very prominent exception.

The controversy:

The communications suggest that Christie’s deputy chief of staff and two of his top appointees at the Port Authority of New York and New Jersey closed a pair of access lanes from Fort Lee, N.J., onto the George Washington Bridge into New York, causing days of gridlock and mayhem in the Fort Lee area last September.

 

 

“He is the worst example of bully and boss,” Buono said. “And this string of e-mails clearly exposes a web of deceit, subterfuge and arrogance leading straight to Chris Christie.”

The "throw everyone under the bus" Full statement

"What I've seen today for the first time is unacceptable. I am outraged and deeply saddened to learn that not only was I misled by a member of my staff, but this completely inappropriate and unsanctioned conduct was made without my knowledge. One thing is clear: this type of behavior is unacceptable, and I will not tolerate it because the people of New Jersey deserve better. This behavior is not representative of me or my Administration in any way, and people will be held responsible for their actions."

Of course, there is one very large exception to that statement…


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/Jp3snPu06gc/story01.htm Tyler Durden

Wednesday Humor: Radiation-Free Snow For Sale

We are quietly confident that the gentleman selling the ‘radiation-free’ snow will be inundated with offers from Japanese winter sports enthusiasts (or perhaps even Sochi-ites)…

 

Via St.Louis Craigslist,

One pickup truck load of authentic St. Louis Missouri Snow for sale that “appears to be” *Radiation-free*!

This snow fell in St. Louis county during the greatest snowfall in St. Louis since 1982! Be the envy of your friends knowing that your snow is indeed *Radiation-free*!

One could store this pickup truck load of authentic radiation-free snow in cold storage and use it all year long!

Small Print: Unfortunately neither of these 2 commonly used detectors are useful in detecting the major isotopes from a nuclear meltdown, namely Iodine-131, Cesium 134, and Cesium 137.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/tn34u2uCc7A/story01.htm Tyler Durden

The US Consumer Is So Strong, Macy’s Just Fired 2500 And Announced The Closure Of Five Stores

Just out from Macy’s, which first said the following: “The 2013 holiday season was successful for Macy’s and Bloomingdale’s as we offered fresh and distinctive merchandise, delivered great value to the customer and provided a robust omnichannel shopping experience… Even in a questionable macroeconomic environment with challenging weather in multiple states, the positive response from our customers during the holiday season is yet another vote of confidence that our well-established strategies continue to work for us.” What well-established strategies one may ask? Why the following of course, which was also just disclosed in a separate news release “outlining cost reduction initiatives to support continued profitable sales growth”: “Approximately 2,500 employees are expected to be laid off and are eligible for severance as a result of these organizational changes. Other associates are being reassigned with new duties or transferred; some open positions will not be filled.”

And just in case the message was missed, “The company is announcing today that it will close the following five Macy’s stores in early spring 2014:

  • Fiesta Mall, Mesa, AZ (159,000 square feet; opened in 1979; 98 associates);
  • Metcalf South Shopping Center, Overland Park, KS (216,000 square feet; opened in 1967; 88 associates);
  • Jamestown Mall, Florissant, MO (200,000 square feet; opened in 1994; 88 associates);
  • Medley Centre, Irondequoit, NY (129,000 square feet; opened in 1990; 96 associates);
  • Fashion Place Mall, Murray, UT (26,000 square feet; opened in 1988; 42 associates).

Luckily, JCP and Sears are both hiring.

What can one say but a truly vibrant economy, and a consumer that has never been stronger.

As for M stock, it’s up 6% after hours.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/vlNdpX5Jpjg/story01.htm Tyler Durden

The US Consumer Is So Strong, Macy's Just Fired 2500 And Announced The Closure Of Five Stores

Just out from Macy’s, which first said the following: “The 2013 holiday season was successful for Macy’s and Bloomingdale’s as we offered fresh and distinctive merchandise, delivered great value to the customer and provided a robust omnichannel shopping experience… Even in a questionable macroeconomic environment with challenging weather in multiple states, the positive response from our customers during the holiday season is yet another vote of confidence that our well-established strategies continue to work for us.” What well-established strategies one may ask? Why the following of course, which was also just disclosed in a separate news release “outlining cost reduction initiatives to support continued profitable sales growth”: “Approximately 2,500 employees are expected to be laid off and are eligible for severance as a result of these organizational changes. Other associates are being reassigned with new duties or transferred; some open positions will not be filled.”

And just in case the message was missed, “The company is announcing today that it will close the following five Macy’s stores in early spring 2014:

  • Fiesta Mall, Mesa, AZ (159,000 square feet; opened in 1979; 98 associates);
  • Metcalf South Shopping Center, Overland Park, KS (216,000 square feet; opened in 1967; 88 associates);
  • Jamestown Mall, Florissant, MO (200,000 square feet; opened in 1994; 88 associates);
  • Medley Centre, Irondequoit, NY (129,000 square feet; opened in 1990; 96 associates);
  • Fashion Place Mall, Murray, UT (26,000 square feet; opened in 1988; 42 associates).

Luckily, JCP and Sears are both hiring.

What can one say but a truly vibrant economy, and a consumer that has never been stronger.

As for M stock, it’s up 6% after hours.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/vlNdpX5Jpjg/story01.htm Tyler Durden